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1. BACKGROUND

1.1 General

1.1.1 The project for which this report has been prepared has as a development objective the expansion of fish and shellfish farming activity in the Iskenderun Bay area in Turkey.

The immediate objectives are the identification of aquacuture pontentials and the encouragement of private investment in the area.

The individual terms of reference of the Consultants comprising the Mission were as follows:

Economist

To investigate the macro and micro-economic feasibility of the identified aquaculture operations;

In particular to:

Estimate the costs of using the sites for aquaculture as compared to other possible uses;

Prepare model farm budgets including investment costs, cash-flow projection, and operational cost/benefit;

Investigate the factors influencing marketing of the produce including marketing costs, price structure and elasticity for internal consumption and export, including overall demand projections;

Prepare, together with the aquaculture experts, a brief concise and coherent report on the findings and conclusions of the mission.

Finfish Expert

To identify finfish aquaculture potentialities in the area, based on existing local conditions;

To identify potential areas for hatchery/nursery and grow-out systems;

To define aquaculture facilities suitable for the area and provide cost estimates for their installation and functioning.

Shrimp Consultant

To identify shrimp aquaculture potentialities in the area, based on existing local conditions; if necessary, the potential for mollusc culture will also be assessed;

To identify potential areas for hatchery/nursery and grow-out systems;

To define aquaculture facilities suitable for the area and provide cost estimates for their installation and functioning;

To write a detailed report on the above.

National Consultant

To prepare a descriptive overview of the area regarding possibilities for aquaculture development, with special emphasis on physical and biological characteristics and social and economic components;

To assist the three foreign experts in all their tasks, specified in their respective terms of reference.

1.2 Project Approach

1.2.1 With these objectives in mind, the approach of the project has been to select higher-value species - in particular shrimp, sea bass and sea bream - and to assess the feasibility of increasing their production locally through the establishment of commercial farms using intensive and/or semi-intensive methods.

1.2.2 In making this assessment, local and external factors likely to influence technical feasibility, costs of production and market potential have been investigated.

Technical and economic models for different forms and scales of production are presented with the aim of informing future public and private sector investment policies.

1.3 Present Economic Activity

1.3.1 A major economic activity of the area is agriculture. This is of a very intensive form and uses a well- developed irrigation network. Crops produced include wheat, maize, soya, cotton and various vegetables and fruits.

1.3.2 Industrial development, including oil storage, cement, fertilizer, iron and steel manufacture and sand and gravel extraction, has taken place. A major part of the coast at the head of Iskenderun Bay has been zoned for further industrial development.

1.3.3 More recently, large-scale tourism has been developed at several locations along the north-west and south- east coastlines of the Bay. This industry appears to be undergoing rapid expansion.

1.3.4 Fishing activity in the Iskenderun and adjacent Mersin Bay areas is carried out by approximately 900 vessels, 90% of which are powered by engines of less than 20 H.P. The main landing points are at Mersin and Iskenderun. Recent annual landings of the targetted species at these ports were officially estimated as follows:

 IskenderunMersin
 (Metric Tonnes)
Shrimp35470  
Sea Bass1554
Sea Bream1540

1.3.5 Current aquaculture production is limited to harvesting from fish traps at the mouth of lagoons in the Tuzla, Yumurtalik and Karatas areas. The estimates by the local office of the Ministry of Agriculture put total annual production from these sources at 122 M.T. of sea bream and 67 M.T. of sea bass.

1.3.6 In the very recent past, some initiatives have been undertaken to develop semi-intensive on-growing of sea-bass and sea-bream in ponds. The local office of the Ministry has received 5 project proposals for aquaculture development.

1.4 Current Distribution and Markets

1.4.1 Local wholesale prices, particularly for sea bass and sea bream are very low in comparison with those for comparable grades in other southern European markets.

The low prices are due to the distance from the main markets. Generally, fish have to be sold locally or be frozen for export to Europe. The overland journey time of 5 days to European destinations is too great to permit distribution of good quality fresh product. Therefore, the higher returns from fresh sales to European markets are not available using this means of transport. (Average price in northern Italy for frozen sea bream (small grade) in 1987 was US$ 6 per kilo compared with US$ 15 per kilo for fresh product.)

1.4.2 Air transport is available through Turkish Airlines but space is not guaranteed unless by previously arranged contract for regular shipments. The irregularity of landings from capture fisheries discourages exporters from establishing such contracts. Exporting by air transport is consequently limited to occasional small quantities.

1.4.3 Twenty percent of Turkey's annual production of around 4,000 tonnes of shrimp is caught in the East Mediterranean region. Official estimates for wholesale prices at Mersin for 1987 give an average of $6.0 per kilo and average export prices were US$ 5.6 per kilo for the previous year.

1.4.4 Less than 6% of shrimp caught are exported and national sources blame poor export performance on failure to meet international specifications because of inadequate ice supplies, lack of processing capacity and lack of expertise in handling, distribution and marketing.

1.4.5 To maximize returns for more costly aquaculture production systems, international quality control standards will have to be met. The provision of improved facilities and expertise should be considered as an essential part of future aquaculture development.


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